Mr. Speaker, let me begin by applauding the hon. member for Vancouver Island North for his concern for the welfare of unemployed Canadians.
Given the economic setbacks experienced in the member's home province, anything from softwood lumber to SARS and avian flu, I know how important the employment insurance program is to the citizens of British Columbia.
As well-meaning as my colleague's private member's motion may be, however, I think it is essential to point out the potential damage it could do to unemployed workers who are already coping with the challenge of losing a job.
While it may appear that Motion No. 300 is in their best interests, a closer examination reveals that it may not be. There is a very real concern that some of this country's lowest income earners, often part time workers, many of them women, could be really hurt if the motion were adopted. It could actually undo much of the good that we have achieved since reforming the EI program back in the mid-1990s.
I remind the House that our purpose in updating the legislation was to increase coverage and Canadians' access to the program. Prior to 1996 many part time workers were unable to access EI. Anyone who worked less than 15 hours per week was not insured. That is one of the reasons we shifted to the hours based system. It means that every hour of work now counts toward entitlement. This improvement has benefited seasonal workers and part time workers, many of them women who take time away from the labour force to raise young families. The shift to the first dollar coverage has extended the insurance plan's coverage to an additional 400,000 part time workers.
One of the other important changes that we made to the program was to emphasize the necessity of a strong workforce attachment. This serves as a reminder that EI provides temporary financial help to unemployed Canadians while they look for work or upgrade their skills, while they are pregnant, caring for a newborn or adopted child, or while they are sick.
An unemployed worker can only benefit from EI if he or she has earned wages in the previous 26 weeks. The problem is that if we were to exempt the payment of EI premiums on the first $3,000 of income, we would not be able to provide benefits to that amount should anyone become unemployed. That is because the premiums would not have been paid on this income. People have to pay premiums to receive benefits.
More worrisome, if we agreed to a basic yearly exemption, we would effectively be penalizing the most vulnerable and potentially reverting to the 15 hour job trap that affected a previous generation of part time workers. Evidence indicates that the move to the first dollar coverage eliminated the incentive for employers to restrict employees hours to below the minimum insurability.
If Motion No. 300 moves forward, part time workers or people holding down more than one job, generally low income workers, would no longer have to contribute to the EI program until they had earned more than $3,000, but they could not draw from the insurance plan either should they lose their jobs.
Also, if my hon. colleague's intention is to provide a premium refund to low income workers, the motion comes a bit late. We already addressed this problem through the improvements to the program several years ago. As it now stands, employees earning less than $2,000 annually can have their premiums refunded. In 2001 we reimbursed some 859,000 individuals to the tune of approximately $17 million.
With all due respect for the hon. member of the opposition, it is hard not to be cynical and to question the real motivation behind this motion. Even though at first glance it appears to be altruistic, it seems the only beneficiaries would be businesses looking at ways to cut corners at workers' expense.
We do not see it as an either or proposition. I can assure the House that our focus in reforming EI has not been exclusively on workers. We have made equal efforts to address the concerns of Canadian business. One way has been to cut the cost of the program, as the private sector has requested. We have reduced premium rates by just under $10 billion, actually $9.7 billion in 2004, over the past decade. EI premiums have declined steadily, benefiting both workers and their employers.
As my colleagues are aware, our government is determined to do even more. Do not forget that budget 2003 launched consultations on a new permanent rate setting mechanism for 2005 and beyond. The results of these consultations are currently under review. As we reiterated in budget 2004, our intention is to introduce legislation to implement a new EI premium rate setting mechanism that better reflects the economy of the 21st century.
Until we determine what kind of changes we will make to the premium structure however, it would not only be premature but inappropriate to adopt Motion No. 300.
That is not all we are doing for business. Recognizing that small and medium sized enterprises are the key drivers of economic growth and job creation, the budget identified a number of measures to help them grow and prosper.
Industry Canada and its industry portfolio partners will administer a range of incentives and supports to business. For example, to enhance access to venture capital for promising Canadian firms, the government has set aside $250 million for an investment in the Business Development Bank of Canada.
It is expected that these additional investments will lead to over $1 billion in new venture capital investment in Canada. A further $5 million per year is being committed to the industrial research assistance program to strengthen its support for regional innovations and initiatives sponsored by the National Research Council.
We have also committed to work with small businesses to reduce the paper burden, understanding this is a serious concern for many firms. To identify and respond to other priorities, they may and we will seek the advice of the House of Commons Standing Committee on Finance to identify the best options for the future support of small business, taking into account limited fiscal resources.
Equally promising, the Minister of Industry, the Parliamentary Secretary to the Prime Minister with special emphasis on science and small business, and the new national science adviser have been tasked by the Prime Minister to study the commercialization situation in Canada. They will be recommending a long term strategy to put Canada at the leading edge of commercializing its intellectual property.
Therefore, there can be no question of the government's commitment to working with business to keep Canada competitive in the global marketplace. Nor is there any doubt that the motion is not the way to go to support either business, the business community or unemployed Canadians.
I remind the House that various proposals for a yearly basic exemption have been put forward in the past. The idea was debated when EI was developed in 1996 but rejected in favour of first dollar coverage.
As well, the Standing Committee on Human Resources Development and the Status of Persons with Disabilities recommended the same concept in 2001, but it was later concluded that this was not the best approach.
In fact, the 2003 EI monitoring and assessment report tabled on April 27 found that the core elements of the EI program such as an hours based system and the first dollar coverage are working very well.
I stand proudly behind EI, a pillar of the Canadian social safety net that has served Canadians well for more than six decades. I want to assure this country's workers that I will staunchly defend this vitally important program. I will do my utmost to ensure motions like the one proposed by the opposition member enjoy the same fate as previous efforts to introduce a yearly based exemption.
In the interest of fairness and dignity of all Canadian workers, whatever their working arrangements, I cannot with a clear conscience support the motion and I strongly urge others to reject it as well.